What is Private Limited Company Registration?
A private limited company is a separate legal entity incorporated under the Companies Act, 2013, owned by shareholders and run by directors. It limits the owners' liability to their share capital and can raise equity funding. It needs at least two directors and two shareholders, and files annual returns with the Registrar of Companies.
Who needs it
- Startup founders who plan to raise equity funding from angels or venture capital.
- Businesses that want limited liability and a distinct legal identity.
- Teams with co-founders who want a clear shareholding and ESOP structure.
- Growing proprietors who want to move to a more credible structure for lenders and large clients.
- Foreign nationals or NRIs setting up an Indian subsidiary or business.
Benefits
- Limited liability: owners' personal assets are separate from company debts, subject to law.
- Perpetual succession: the company continues regardless of changes in owners.
- Easier to raise equity, issue ESOPs and bring in investors.
- Credibility with banks, vendors and enterprise customers.
- Eligibility for startup recognition and related benefits, if conditions are met.
Authorised and paid-up capital
Authorised capital is the maximum share capital the company can issue, and it fixes the filing fees and stamp duty. Paid-up capital is the amount actually received from shareholders. Start with an authorised capital that matches your plans for the next year or two. You can increase it later, although that needs a resolution and a filing.
- Subscribers must take at least one share each.
- Shares can be issued at face value or at a premium.
- A shareholders' agreement is useful to record roles, vesting and exit terms between founders.
Example: two founders starting a software company
Two founders agree on a 50:50 shareholding. They select a name, rent a small office, get digital signatures, and file the incorporation forms. After the certificate arrives, they open a bank account, transfer share capital, hold the first board meeting and appoint an auditor. They register for GST because they will sell to businesses in several states. They keep a simple founders' agreement that covers roles, vesting of shares and what happens if one founder leaves, which later makes fundraising smoother.
First-year compliance in short
A new company has a handful of obligations in its first year, and the first two fall due long before the year end.
- Within 30 days: appoint the first auditor and file the form.
- Within 180 days: file the commencement of business declaration.
- At the year end: get accounts audited and hold the AGM.
- After the AGM: file AOC-4 and MGT-7.
- Through the year: file GST, TDS and income tax returns where applicable.
Documents required
- 01PAN and Aadhaar of every director and shareholder
- 02Passport-size photographs and specimen signatures
- 03Address proof of directors (bank statement or utility bill, recent)
- 04Email id and mobile number of each director
- 05Registered office proof: utility bill and rent agreement with the owner's NOC
- 06Proposed company names (2–3 options) and main business objects
- 07For foreign directors or shareholders: passport and notarised or apostilled address proof
- 08Digital signature certificates for the proposed directors
Due dates and penalties
| Item | Due date | If missed |
|---|---|---|
| Commencement of business declaration (INC-20A) | Within 180 days of incorporation | Penalty on the company and officers; risk of strike-off |
| Appointment of first auditor (ADT-1) | Within 30 days of incorporation | Penalty and default in statutory compliance |
| Deposit of subscription money | Within 180 days of incorporation | Liability under the Companies Act |
| Annual filings (AOC-4, MGT-7) | 30 and 60 days from the AGM | Additional fee of ₹100 per day per form |
Government fees, stamp duty and DSC charges are extra and vary by state and authorised capital. We give an itemised estimate before you start.
Mistakes to avoid
- Choosing a company name too similar to an existing company or trademark.
- Setting authorised capital very high, which increases stamp duty and fees for no benefit.
- Using a registered office address without proper proof or the owner's NOC.
- Skipping the founders' agreement, leaving roles, vesting and exits unclear.
- Forgetting INC-20A and the first auditor filing after incorporation.
- Not keeping minutes and statutory registers from day one.
Why PHMG
- Partner-led: a chartered accountant reviews your work, not only a junior team.
- Clear fee and scope in writing before we start.
- Deadlines tracked for you, with reminders well before the due date.
- Your documents and data are handled confidentially.
- Online service across India, with a single point of contact.
Fees depend on your case. Request a quote for a clear scope and fee.